Standing Committee E

[Part I]

[Mr Peter Atkinson in the Chair]

Health and Social Care (Community Health and Standards) Bill

Schedule 2 - Independent Regulator of NHS Foundation Trusts

Amendment proposed [this day]: No. 215, in 
schedule 2, page 98, line 36, at end insert— 
 'Right to Appeal to Regulator 
 6A Employers of health service staff in nonfoundation trusts affected by decisions made by foundation trusts in respect of their terms and conditions of employment, may ask the regulator to judge if these are a breach of section 26 of the Health Act 1999, as amended by this Act.'.—[Mrs. Calton.]
 Question again proposed, That the amendment be made.

John Hutton: I have absolutely no idea where we finished before lunch. I am sure that we were having a useful discussion; I was on my feet, so that is axiomatic.
 The hon. Member for Cheadle (Mrs. Calton) raised the important issue of how to deal with poaching or unfair competition between NHS organisations for staff. The hon. Lady clearly wished to insert a provision in the Bill, although she did not make clear whether this was a probing amendment, that would involve the independent regulator in making decisions on whether there had been a breach of the statutory duty of co-operation. He must do that anyway, as it is his job to ensure that all NHS foundation trusts comply both with the terms of their authorisation and the terms of the statutory provisions that relate to their function. Therefore, the hon. Lady's point is already encompassed in the Bill. 
 The discussion ranged further, Mr. Atkinson, as to whether it would be appropriate for the independent regulator to vary employment terms and conditions, or for him to impose additional restrictions on NHS foundation trusts when it came to the employment of staff. We do not want to go down either of those two latter roads, as that would not be an appropriate role for the regulator. I hope that Committee members take that view. Such matters are best dealt with by unions, staff and employers. I hope that I have been able to assure the hon. Lady that the valid point she raises is covered by the Bill, and that she will not press her amendment to a Division.

Patsy Calton: I thank the Minister for his thoughtful response; I am reeling from the tributes. I am pleased that he recognises that there is a recruitment problem in the NHS, which could worsen
 as we phase in foundation trust status for, as I understand it, all hospitals.
 I have listened to the Minister's reassurances that ''Agenda for Change'' deals with the problem, and I would ask the Secretary of State to keep a watchful eye on that aspect of the two-tier system. I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Question proposed, That this schedule, as amended, be the Second schedule to the Bill.

Simon Burns: I do not intend to detain the Committee for long. First, as will have become apparent during our debate on the amendments proposed to schedule 2, my hon. Friends and I are still concerned—notwithstanding what the Minister has said to seek to reassure us—that the independence of the independent regulator is compromised by the arrangements, even if they are administrative arrangements over his appointment. I will check that in Hansard on Thursday morning, and study it further, with a view to possibly returning to the subject. My hon. Friend the Member for South Cambridgeshire (Mr. Lansley) may wish to do that at a later stage in the proceedings.
 Secondly, paragraphs 10 and 11 in the schedule are perfectly straightforward. They amend the House of Commons Disqualification Act 1975 and the Northern Ireland Assembly Disqualification Act 1975, and those will now state that the regulator for foundation trusts is disqualified from being a Member of this House or of the Northern Ireland Assembly. 
 The Under-Secretary said—I think it was during the debate on clause 1—that, at some point, the Government would table an amendment to make it a disqualify from this House someone on the board of governors of a foundation trust. Presumably that would be a straightforward amendment; however, looking through this morning's list of amendments, I see that it has not been forthcoming. Would it have been possible for the Government to have produced the amendment to include in the schedule because it deals with disqualification, or would that be inappropriate? Will the Government have to attach that amendment to another schedule or clause? When does the Minister expect that amendment to be tabled for our consideration?

John Hutton: The current intention is to table that amendment as a consequential amendment to schedule 4. It would not be appropriate to insert such an amendment in schedule 2, which relates to the office of the independent regulator. The hon. Gentleman's point relates to non-executive directors.
 Schedule 2, as amended, agreed to.

Clause 3 - GENERAL DUTY OF REGULATOR

Andrew Lansley: I beg to move amendment No. 232, in
clause 3, page 2, line 2, at beginning insert— 
 '(1) The primary duty of the regulator is to facilitate the provision by NHS foundation trusts of health care services at a higher clinical standard and responsiveness to patients. 
 (2) '.

Peter Atkinson: With this it will be convenient to discuss the following amendments:
 No. 107, in 
clause 3, page 2, line 2, leave out from 'functions' to end of line and insert 
 'in order to secure that NHS foundation trusts have the freedom from external constraints needed to enable them to offer health care services which are enhanced in terms of their volume and quality, and in a manner not inconsistent with'.
 No. 244, in 
clause 3, page 2, line 2, leave out 'consistent with' and insert 'in pursuance of'.
 No. 200, in 
clause 3, page 2, line 5, at end add 
 'and shall have a duty to safeguard the best interests of the NHS as a whole'.
 No. 245, in 
clause 3, page 2, line 5, at end add 
 'and that is consistent with the principles of fairness and of universal coverage'.
 No. 123, in 
clause 3, page 2, line 5, at end add—
'(2) In performing his duties under this Act, the regulator must have regard to such of the following as appear to him to be relevant in the circumstances— 
 (a) the principles under which regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases where action is needed, 
 (b) the different needs and interests of persons using NHS services and, in particular, of the different interests of children, and of those living in rural and urban areas; and 
 (c) the principles set out in the Compact between Government and the voluntary sector and the codes of practice set out under it.'.

Andrew Lansley: I shall forbear to say that schedule 4 is not the right place to insert House of Commons disqualification. That relates to the previous debate. Schedule 4 is the schedule of amendments to the law in relation to the introduction of the term ''NHS foundation trust''. There we go; we have moved on.
 Clause 3 is simple in its way, but therein lies a wealth of meaning. The purpose is to introduce the duties of the regulator. The manner in which the duties are defined says that they are, in effect, consistent with the duties of the Secretary of State as consolidated under the National Health Service Act 1977. 
 Before discussing those duties and where there might be enhancement and improvement of their definition, it might be helpful to recognise that in a whole series of Acts in recent years—and, perhaps more to the point, in the practice that has flowed from that legislation—it has become apparent that there is a significant difference in practice between the exercise of duties by a Secretary of State and by a regulator. 
 There was an exchange this morning about the nature of regulation as opposed to other ways of exercising functions. A Secretary of State is not a creature of statute, with limitations bounded by statute, as are regulators and local government. He is not precluded from having regard to issues beyond those set out in the statutes that he uses. A Secretary of State has to have regard to certain duties that are set out in statute, but is not circumscribed by those duties 
 as not to have any regard to other issues. In practice, we see Secretaries of State as policy-makers who expand the boundaries of their vision as they apply their duties according to changing circumstances. 
 Regulators are somewhat different beasts; they are creatures of statute. All recent experience tells us that if one does not tell regulators—as distinct from Secretaries of State—what their duties are, or what they should have regard to in the exercise of their duties, it is highly likely that they simply will not expand the boundaries of their thinking to embrace any additional duties or consider matters that are outside the boundaries that have been set in statute. 
 It is necessary when establishing the post to set out precisely the duties of the regulator and what he or she ought to have regard to. I hope that the Minister agrees. The difficulty is that the manner in which clause 3 is drafted suggests that the regulator is nothing other than a statutory counterpart to the Secretary of State and has no distinct function. The duties of the Secretary of State in relation to the NHS seem, in effect, to be carried through into the duties of the regulator, even though the regulator has specific functions to perform.

John Hutton: I am not sure that I follow the hon. Gentleman's point. If he is saying that the regulator is simply a replication of the Secretary of State, he has fundamentally misunderstood the nature of the Bill. The Secretary of State has a range of additional functions relating to, for example, resources and national standards that are not the responsibility of the regulator, whose statutory functions are set out clearly in part I of the Bill. There is no ambiguity about the respective roles of the regulator and the Secretary of State.

Andrew Lansley: I accept that some functions relate to standards and the like, and we shall discuss those later. Those form part of the structure of the NHS as a whole and are not the functions of the regulator. Perhaps I should be more precise. With regard to the functioning of the trusts, it is clear from clause 3 that the regulator's objectives are simply a reiteration of the Secretary of State's duties.

Stephen Pound: The hon. Gentleman is aware that not every person in the room is wholly enamoured of every comma in the Bill. Will not he agree, however, that when the post of regulator was advertised widely in the newspapers last week, the role had inevitably to remain slightly elastic, as the person clearly would be interviewed, and perhaps even appointed, before the Bill became law?

Andrew Lansley: I was not aware that the post of regulator had been advertised.

Stephen Pound: I have a copy if the hon. Gentleman wants it.

Andrew Lansley: I am grateful to the hon. Gentleman, but I am not sure that that bears upon the issue in clause 3. Let us say that the regulator will be in place by October, for the sake of argument. If I were proposing to have a regulator appointed and in place by then, I should certainly consider advertising now. I do not dispute the necessity of preparing for that
 appointment, but that has no bearing on the duties of the regulator. Those are for the Committee to determine and cannot be pre-empted by the nature of an application and interview.
 Whatever the existing statutory provisions regarding the duties of the Secretary of State in the matter of NHS trusts that become foundation trusts, we must ensure that the duties of the regulator are properly expressed so that, when in place, the regulator will have the statutory breadth to be able to fulfil his or her functions fully and adequately, without being constrained by clause 3. 
 Some of my amendments are probing, but I believe that the Government should accept the others. Amendment No. 232 is a probing amendment. At this stage, it might be helpful to recall the 1977 Act, although it would be tedious to quote it at length. Section 1—the Secretary of State's duty as to the health service—states: 
(1) It is the Secretary of State's duty to continue the promotion in England and Wales of a comprehensive health service designed to secure improvement— 
 (a) in the physical and mental health of the people of those countries, and 
 (b) in the prevention, diagnosis and treatment of illness, 
 and for that purpose to provide or secure the effective provision of services in accordance with this Act. 
 (2) The services so provided shall be free of charge except in so far as the making and recovery of charges is expressly provided for by or under any enactment, whenever passed. 
 That section of the 1977 Act appears to be wide-ranging, given that comprehensive objectives are set out. Secretaries of State can cope with wide-ranging duties, but regulators require detailed knowledge of their objectives. To what extent does the fact that the Secretary of State has a duty to secure improvement of people's physical and mental health and in the prevention of disease, diagnosis and treatment of illness imply that the regulator would already have a duty to promote ''higher clinical standards''? If the Minister says that the first part of amendment No. 232 is clearly embraced, that would be step one and a tick in the box. 
 The second part of the amendment deals with ''responsiveness to patients''. As far as I can see, section 1 of the 1977 Act does not give the Secretary of State a statutory duty to respond to patients directly, although some interpretations may imply that that is the case. That issue may be dealt with elsewhere in the Bill, but given that it is not included in that section of the 1977 Act, it is not the regulator's duty. 
 Section 3 of the 1977 Act—concerning services generally—states: 
(1) It is the Secretary of State's duty to provide throughout England and Wales, to such extent as he considers necessary to meet all reasonable requirements— 
 (a) hospital accommodation; 
 (b) other accommodation for the purpose of any service provided under this Act; 
 (c) medical, dental, nursing and ambulance services; 
 (d) such other facilities for the care of expectant and nursing mothers and young children as he considers are appropriate as part of the health service; 
 (e) such facilities for the prevention of illness, the care of persons suffering from illness and the after-care of persons who have suffered from illness as he considers are appropriate as part of the health service 
 (f) such other services as are required for the diagnosis and treatment of illness.
 That section does not suggest responsiveness to patients so much as responsiveness to NHS providers. A regulator must not only be responsive to applications from NHS trusts to become foundation trusts; he or she must have a duty to respond to patients' needs. Can we put a tick in the box to say that the regulator's duty is to respond to patients? 
 I am sure that the first part of amendment No. 107 is not embraced in the existing duties of the Secretary of State under the 1977 Act. The Bill should ensure that 
''NHS foundation trusts have the freedom from external constraints needed to enable them to offer health care services which are enhanced in terms of their volume and quality''.
 A clear duty already exists to enhance the volume and quality of NHS services, but there is no duty on the Secretary of State to free NHS foundation trusts or other NHS institutions from external constraints to enable them to do so. The concept of deregulation is not built into the Secretary of State's current duties.

John Hutton: The hon. Gentleman makes a good speech, but will he explain what he means by ''external constraints''? For example, external constraints could reasonably include the work of the medical royal colleges and outside regulatory bodies. If he believes that that type of constraint should be covered by this clause, there is clearly a problem with the wording of his amendment.

Andrew Lansley: The Minister is being uncharacteristically literal and narrow. If he reads the amendment, he will see that the freedom from external constraints that is spoken of enables the foundation trust to offer
''health care services which are enhanced in terms of their volume and quality''.
 Clearly, if the work of the royal colleges forms part of the process by which NHS foundation trusts improve the volume and quality of their health care services, it would not be an external constraint from which they would need to be free. 
 I freely confess that the drafting of the amendment is not important here; it is the argument that is important. The point is that there is no deregulatory duty laid upon the independent regulator. The Minister may tell the Committee that it is not the intention of the Government to deregulate by the imposition of the independent regulator, but is that not the structure of the legislation? Is it not the intention to create freedom for NHS foundation trusts? 
 If the intention of the Bill is to create a new structure within which foundation trusts are given the freedom, through localisation of management and the removal of constraints upon managers, to deliver 
 effective services, is it not curious that the role of the regulator does not explicitly contain just such a deregulatory duty? It is not in the Bill. Other legislation in other contexts, which we have debated here, does lay a duty of a deregulatory character upon regulators. I have simply phrased it in terms of deregulation to the extent that is consistent with all their other duties to raise the volume and quality of health care services that are being offered. If the principle of the Bill is one of freedom for foundation trusts, why is that principle not included in the Bill as one of the duties? 
 The latter part of amendment No. 107 has another small but significant purpose, and that is to rephrase clause 3. As it stands, clause 3 states that functions must be exercised 
''in a manner that is consistent with the performance by the Secretary of State''.
 That now becomes a matter of interpretation. It was not part of my argument when we debated clause 2 that there was some conspiracy theory about the independent regulator's functions to be determined by the Secretary of State. That did not form part of my discussion of clause 2, nor was it part of my amendments. 
 Here, however, the question does arise. Is it, in fact, the case that, because of the structure of the wording of the clause, the independent regulator will be constrained to behave in a way that is consistent with the Secretary of State's past, present or future interpretation of his duties under sections 1, 3 and 51 of the National Health Service Act 1977? 
 In so far as those are wide-ranging duties, and many of the things that the Secretary of State does could be interpreted as being in accordance with that, it might well be that, by virtue of the statute, the independent regulator has no independence to interpret those duties in a way that is different from the Secretary of State. In practice, therefore, the independence is undermined. That is why I turn the wording around and say 
''in a manner not inconsistent with''
 so that at least we do not allow clear division inside the NHS about this, but do allow a degree of latitude as to how the independent regulator—as compared to the Secretary of State—interprets the duties into any particular set of circumstances. 
 That sums up amendments Nos. 232 and 107. I confess to you now, Mr. Atkinson, and to the Committee, that I do not intend to press those amendments. They are designed to get answers on the way in which the duty of the regulator ought to be structured, and on some matters that ought to be included but which I do not see. The Government should accept amendment No. 123 as it is. This is not so much about the duties of the regulator as about the manner in which the regulator should exercise those duties. There are three elements to this; the words 
''as appear to him to be relevant in the circumstances''
 do not refer to overriding considerations but to considerations according to the circumstances. 
 First, we are meeting regulators everywhere nowadays. Again, we get into the rigmarole of how regulators work, yet the principles of the Better Regulation Task Force, of blessed memory, are reflected in the principles that are applied to regulators. Those are the principles of transparency and accountability. Moreover, regulators must be proportionate, consistent, and target only cases in which action is needed. To an extent, of course, if those principles were included through amendment No. 123, some of the deregulatory duty implied in amendment No. 107 would not be needed. 
 The question is whether the regulatory principles—the best regulatory principles enunciated by the Government for regulators across Government as a whole—are to be reflected in the statutory obligations of this independent regulator. Will the different needs and interests of persons using NHS services be addressed? As far as I can tell, Mr. Atkinson, the duties that are included in the National Health Service Act 1977 do not differentiate. It may be that, although we are talking about localisation and, in theory, about responsiveness to the different needs of patients, the regulator has no statutory backing to require him to address responsiveness. 
 I have isolated two examples. The first, in practice, is the structure of foundation trusts and how they work and interact with other health service bodies and, indeed, other local authority bodies, which may well differ between rural and urban areas. I will not make a long argument about rural areas. Departments ought to take this as read because of the nature of rural-proofing of legislation. However, as the Bill has regard to the different interests of urban and rural areas, the independent regulator is obliged to rural-proof the way that he does his work. 
 Secondly, the different interests of children in the NHS must also be addressed. Again, the different interests of children in the NHS ought to be meat and drink to Ministers. As a consequence of a range of reports that were discussed in the House as recently as the publication of the Kennedy report on the outcome at Bristol royal infirmary, Ministers are trying to ensure that the NHS has a separate and distinct focus on the needs of children. That focus is enunciated in the first part of the national service framework for children, and has been made obvious by the Government's initial response to the Victoria Climbié inquiry and the promotion of the pilots for children's trusts. 
 Not only that, but within the structure of the NHS—linking together local authorities and other bodies with responsibilities for children—the presence of children's trusts will make it clear that the independent regulator must have regard for the ways in which services are configured for children. Those services must be distinct and different from those configured for the rest of the NHS's patients. 
 The third limb is the compact between Government and the voluntary sector. I am sure that the Minister will recall that the Department of Health has an obligation—the terms of which are available on one of the Department's web sites—by which it is 
''determined to see all NHS organisations in England signed up to a geographically relevant Local Compact by 31 March 2004''.
 I am sure that the Minister will be equipped to tell us today whether that will be the case, and whether it will apply to NHS foundations trusts. However, it does not completely answer the point, because ''geographically relevant local compacts'' are relevant from the point of view of trusts working with local authorities and local voluntary organisations. 
 The question is whether the independent regulator will be required to comply with the compact, which, at a national level, is an agreement between central Government and the National Council for Voluntary Organisations. That is important, because voluntary organisations may, in the fullness of time, become substantial clients of the independent regulator. If, for example, under clause 5, which deals with other applications, a body other than an existing NHS trust, such as a group of hospices, was to become an applicant for NHS foundation trust status, it would be a voluntary sector organisation seeking to receive authorisation from the independent regulator. 
 As I understand it, the compact is currently an agreement—without statutory backing—between central Government and the voluntary sector. It applies to Departments in central Government. By extension, it applies to Executive agencies and non-departmental public bodies that are answerable to those Departments. It does not apply to existing regulators. I know that to be a fact because the NCVO has been in touch with other regulators, who have said that they have been established by statute as non-ministerial Departments and that their responsibilities and requirements are laid down in statute. The compact is not part of those requirements and, therefore, cannot be applied to those independent regulators simply because Ministers have agreed with the NCVO. 
 If the good principles set out in the compact about the manner in which central Government deal with voluntary sector organisations are to be applied, including, for example, some of the principles of fairness and equity in applications for NHS funding—NHS authorisation of a foundation trust is a very good example—it is important that the compact be applied specifically to the independent regulator as a non-ministerial Department. Provision for that must be included in the Bill. 
 I hope that I have explained to Ministers, particularly on amendment No. 123, why these aspects of the independent regulator's work should be expressed at this point in the Bill. As far as I am aware, and unless I am told otherwise, the drafting is adequate for that purpose. I speak to amendment No. 232 for the purposes of our discussion today, but I reserve the possibility of pressing amendment No. 123 to a Division later.

Patsy Calton: I shall speak to amendments Nos. 244 and 245.
 On amendment No. 244, I follow some of the arguments made by the hon. Member for South Cambridgeshire, who referred to the difference 
 between ''consistent with'' and ''not inconsistent with.'' My party and I should like to explore the idea that the terminology of ''consistent with'' is less sharp than ''in pursuance of.'' Clause 3 states: 
''The regulator must exercise his functions in a manner that is consistent with the performance by the Secretary of State of the duties under sections 1, 3 and 51 of the National Health Service Act 1977''.
 There should be no room for muddying the water with terminology. The phrase ''consistent with'' is not as clear as ''in pursuance of''. I am keen to hear the Minister's response to our suggested wording. 
 Amendment No. 245 proposes that the regulator should have regard to 
''the principles of fairness and of universal coverage''.
 When foundation trusts are being established, there is a concern that initially there might be a two-tier system. Some new foundation trusts may cherry-pick some services over others; for example, they may choose to do away with emergency care.

Simon Burns: The hon. Lady explained forcefully, in discussing amendment No. 244, why she thought that the words ''consistent with'' were inappropriate and why the words ''in pursuance of'' were better. Why, therefore, does amendment No. 245 not use the words ''in pursuance of'' rather than ''consistent with'', given that the words ''consistent with'' are so inappropriate in amendment No. 244?

Patsy Calton: We could all split hairs. I wondered what amendment No. 232—

Simon Burns: Will the hon. Lady give way?

Patsy Calton: If I might finish what I was saying. Amendment No. 232 states that
''The primary duty of the regulator is to facilitate the provision by NHS foundation trusts of health care at a higher clinical standard''.
 The amendment does not state what the standard is higher than. We are concerned that emergency care and other vital services such as mental health—[Interruption.]

Andrew Lansley: My intervention is directly relevant to the point that the hon. Lady makes. I do not understand why she believes that the ''principles of universal coverage'' is a better expression of the need to maintain services than the duty under section 1(1) of the 1977 Act:
''to continue the promotion in England and Wales of a comprehensive health service''.
 Is a ''comprehensive health service'' not, by definition, similar to the ''universal coverage'' that she seeks?

Patsy Calton: I thank the hon. Gentleman for his intervention. There are distinct similarities between the expressions. However, as we move into a new system, it is important that the Minister answers the questions and confirms that the intention is to have the same universal coverage as that we expect now.

Chris Grayling: I speak in support of the amendment that my hon. Friend the Member for South Cambridgeshire seeks to press to a Division. He will, of course, have the support of his
 colleagues. His is a sound and well-articulated amendment.
 The tone of clause 3 prompts once again the question as to where is the clinical element of the Bill. Too much of the Bill is about structures and constitutions, and there is little mention of the duty of care to deliver proper clinical improvements. My hon. Friend the Member for South Cambridgeshire, in his first amendment, makes an extremely important point about strengthening the role of the regulator in delivering higher quality health care.

John Hutton: The hon. Gentleman bemoans the fact that there is nothing in the Bill specifically about clinical quality and about promoting higher quality services. Does he not realise that it was the Labour Government that introduced a duty to improve the quality of clinical care in NHS trusts? His Government had a long time to do that and never managed to get round to it. The duty to improve the quality of care was imposed on the NHS by this Labour Government.

Chris Grayling: There is a difference in philosophy on the two sides. On the Opposition Benches, we prefer to do things, whereas those on the Government Benches prefer to draw up, organise and restructure. The weakness in the Government's approach is that the national health service has spent far too much time reorganising and far too little time spending money on the front line of clinical services. To that effect, a duty that requires the regulator to focus on clinical improvements is entirely appropriate and is to be supported. I look forward with interest to hearing the Minister's responses to amendments that are well articulated and deserve a proper response.

George Young: I want to add a short footnote to the powerful speech of my hon. Friend the Member for South Cambridgeshire. [Interruption.]

Peter Atkinson: Order. I am sorry to interrupt the right hon. Gentleman, but I am having difficulty in hearing his footnote because there is so much conversation going on in the Room.

George Young: I am grateful for your protection, Mr. Atkinson. Clause 3, as it stands, is stark and does not do justice to the role of the independent regulator that the Secretary of State and the Committee would like to see. Clause 3, entitled ''General duty of regulator'', is basically saying, ''Don't get in the way of the Secretary of State; exercise your functions in a manner that is consistent with the performance of the Secretary of State''. I should prefer to see a more explicit statement on the general duties of the regulator. It is some time since I considered the Railways Act 1993, but the railway regulator had a positive duty to promote the welfare of rail travellers. In his negotiations he found it useful to point to the equivalent of clause 3 and to say that he had a duty to promote the interests of rail travellers.
 It would be helpful if the regulator pointed to a provision in clause 3 of the Bill that gives him some clout, rather than the present wording, which puts him in the shadow of the Secretary of State. At the 
 moment, the clause reads as if the regulator is a planning inspector performing what I call ''the Dolcis function''; he stands in the shoes of the Secretary of State. 
 The regulator is more than just a shadow of the Secretary of State; he has a duty in his own right to promote the sort of functions that my hon. Friend has spoken about. Those views are not just mine; they are also the views of the Select Committee. My amendments replicate paragraph 137 of the Health Committee's second report on foundation trusts. The Committee said: 
''We therefore urge the Government to overlay these plans with a mechanism to ensure that these potential problems do not materialise. This could include placing a legal duty on the Regulator to safeguard the best interests of the NHS as a whole.''
 That is what amendment No. 200 seeks to do. It picks the recommendations of the Select Committee, which had the Bill before it when it made its recommendations. The paragraphs before paragraph 137 explain why the Select Committee felt that such a duty should be placed on the regulator. 
 The hon. Member for Cheadle mentioned some of the fears of non-foundation hospitals, including the fear that there might be an initial diversion of funds. Placing a legal duty on the regulator to safeguard the best interests of the NHS would reassure those hospitals. However, other amendments tabled by my hon. Friend the Member for South Cambridgeshire would give the regulator the necessary credibility and clout in his negotiations. 
 It would be better to state the regulator's duties clearly in the Bill rather than to leave the regulator to interpret clause 3. It is nebulous and replicating; it is all about not falling out with the Secretary of State. The Minister said that the regulator does have duties, which we will move on to shortly, on financial matters and on the processing of applications. Clause 3 is entitled ''General duty of regulator'', and unless the Government agree to some of these amendments, the Minister will miss a trick and the regulator will not be able to do the job that we want him to.

Gary Streeter: I support my right hon. Friend the Member for North-West Hampshire and my hon. Friend the Member for South Cambridgeshire. I wish to read out clause 3, which, as my right hon. Friend says, is important. I am concerned about transparency and accessibility. Members of the public who become members of a foundation hospital trust, some of whom will sit on boards of governors, will want to know the legal framework within which they will operate. One of their first questions will be on the duty of the regulator. The Act, as it will then be, will read:
''The regulator must exercise his functions in a manner that is consistent with the performance by the Secretary of State of the duties under sections 1, 3 and 51 of the National Health Service Act 1977 (c. 49) (duty as to health service and services generally and as to university clinical teaching and research).''
 The next question will be, ''What does that mean?'' Reference must then be made to the 1977 Act. Although I accept that it is not unknown in statute for the Government to refer to previous Acts, it would be better and would make accessibility cleaner and 
 clearer if the Bill did not refer to a former statute to identify the duties of the regulator, but had them fully set out in the Bill. Therefore everyone could read the duties of the regulator in what could be called a mission statement. 
 The Under-Secretary has been passionate about her wish for new people to experience ownership of the trusts and to sit on boards of governors. She wants to make foundation trust hospitals open to all; that is laudable. So why have such a barrier to accessibility in a completely imprecise clause setting out the duties of the regulator? 
 My right hon. and hon. Friends made some powerful points. Can it possibly be right that a section that was drafted in a different world from today's and refers to a Secretary of State for Health in 1977 can give the full and comprehensive framework for a regulator operating in 2003? We have already heard examples of how there must be differences and incompleteness in the provisions of the 1977 Act. I do not need to remind the Committee of how different the world was in 1977. I think that that was the year in which Harold Wilson handed over to the now Lord Callaghan.

Andrew Lansley: That was 1976.

Gary Streeter: That is what I said. It was shortly after Harold Wilson handed over to Lord Callaghan.
 It was the year in which Austin Allegros littered the sides of the motorway, because they could not go for more than 30 miles without breaking down. It was the year in which I left university—now my daughter is leaving university. The world has moved on since 1977.

Simon Burns: Was not 1977 also the year in which the Chancellor had to return to London from the IMF humiliation?

Gary Streeter: My hon. Friend makes a powerful political point. [Interruption.] It is certainly not irrelevant: every Labour Government fails in fiscal management.

Peter Atkinson: Order. We are discussing clause 3, not political history.

Gary Streeter: My point, Mr. Atkinson, is a serious one. The provisions of the 1977 Act cannot possibly form a comprehensive framework for a regulator in 2003. I refer to my previous point: if we wish to make this process honest, open and transparent, why not set out the general duties in the Bill and make it the mission statement that the regulator can photocopy and pin up on his wall? That is the kind of simplicity at which we should be aiming.
 My hon. Friend the Member for South Cambridgeshire made a point about creating links with the voluntary sector, and Governments have always talked about statutory bodies working in partnership with the voluntary sector. I have had many dealings with the voluntary sector over the past few years, including many discussions with the National Council for Voluntary Organisations and others, and I know for sure that the laudable aspirations set out in the compacts that the Government produce are not realised in practice. It 
 is very important that the regulator has a duty, in accordance with his wider duties, to make sure that professionals who are running services in foundation hospital trusts have a mind to partnerships with voluntary sector organisations. That should be expressly included in the Bill. It is to be hoped that the Minister will not just pay lip-service to these amendments, rather that he will dig down deep into his character, listen carefully to the points being made and improve the Bill. If he does that, he will go down in history as a new Labour Minister who does not just say that he will listen and take the Opposition's points seriously, but who means it.

John Hutton: I congratulate the hon. Member for South Cambridgeshire for another very effective contribution. I hope that that does not embarrass him too much. I shall not enter into a philosophical discussion about the nature of regulation vis-à-vis the powers of the Secretary of State. That would not be useful. There are substantive and important differences, but we can have that discussion at another time. He is right, as is his right hon. Friend the Member for North-West Hampshire, to focus on clause 3 as an important part of the Bill. The hon. Member for South-West Devon (Mr. Streeter) is right too in some of his comments about the centrality of the clause to the Bill.
 However, I disagree with the hon. Gentleman's commentary on clause 3. With respect, it is not opaque or unclear about the duties of the regulator; they are set out clearly in the Bill, although there is a cross-reference to an earlier statute. Part of the problem with the debate is that sections 1, 3 and 51 of the 1977 Act are very clear about the general duties of the Secretary of the State, and those general duties have stood the test of time. No one can dispute that the legislation is 26 years old; that alone is no reason to say that it is no longer effective. It provides an effective guide for the regulator through his duties under the Bill. 
 I must disagree with the hon. Member for South Cambridgeshire on one fundamental point: the principle of greater operational freedom that both he and I want to see for NHS foundation trusts is not incompatible with the Secretary of State's general duties under the 1977 Act. Running through his presentation of the amendment and the comments of various Opposition Members was the fundamental flaw that the two things were not compatible. Therefore a need for an express duty in the Bill to defend the regulator's job to be a deregulator to preserve the freedoms of NHS foundation trusts is misplaced. 
 The duties of the Secretary of State, under sections 1, 3 and 51 of the 1977 Act are in no way incompatible with greater operational freedom for local NHS hospitals. I take issue with the hon. Gentleman's criticism of clause 3 and with his attempt to redress what he sees as shortcomings in that part of the Bill. He is wrong in that regard. 
 I shall develop that point briefly, although I do not wish to detain the Committee unnecessarily, as I do not think that the hon. Gentleman will press the 
 amendment to a Division. I wish to discuss how we perceive the role of the regulator. 
 The second tier of the hon. Gentleman's argument, about having an express deregulatory duty built into the legislation of the regulator, is unnecessary because the deregulatory aspects of the Bill, in the sense of the greater operational freedoms of NHS trusts, are clearly set out in part 1. It will be the duty of the regulator to give effect to those provisions, and the freedoms secured by clause 14 are clearly set out. 
 There is a crucial difference between this reform of the NHS and previous attempts at reform, including the then Conservative Government's attempts to set NHS trusts free from Whitehall control in the National Health Service and Community Care Act 1990. This legislation will not allow the Secretary of State to direct either the regulator or an NHS foundation trust in any aspect of their work. That is the key cultural division and the historical significance of this measure. It is a break with the past. I accept that. That is one of the provisions that will ensure the operational freedom that the hon. Member for South Cambridgeshire wants to see for NHS foundation trusts.

George Young: The Minister said that there is nothing in the Bill that gives a Minister power to direct the regulator. However, if the Secretary of State, having consulted clause 3, came to the conclusion that the regulator was acting in a manner inconsistent with sections 1, 3 and 51 of the 1977 Act, presumably he would notify the regulator that, in his view, the regulator was acting outside those guidelines, and he would request the regulator to step back within the boundaries of the legislation. Therefore, in practice, does the Secretary of State not have the power to direct the regulator when he thinks that the regulator is wrong?

John Hutton: I shall come to that point, because it is important. To some extent, it takes us into the debate about the word ''consistent'' that the hon. Member for Cheadle was developing in her short contribution. I do not see that as a power of direction.
 There is an important issue in clause 3 for the Committee to discuss, although I hope that it will not do so at length. NHS foundation trusts will play an important role in future and will make an important contribution to the delivery of NHS services for millions of people. Given that importance, it is right that there should be consistency between how the regulator develops his responsibilities and the responsibilities of the Secretary of State. The Secretary of State has the primary statutory duty to ensure the provision of comprehensive NHS services that are free at the point of delivery and that will improve the health and well-being of the people of this country. There is a need for consistency in how these responsibilities are discharged. 
 It cannot be in the best interests of the NHS to be pulled in two directions, one way being pursued by the regulator and his interpretation of the duties and the other way by the Secretary of State. Given the right 
 hon. Gentleman's extensive ministerial experience, I am sure that he will recognise that it would not be sensible for us to legislate for that. 
 There must be a way of resolving these matters. The Bill makes it clear that the regulator must discharge his duties in a way that is consistent with how the Secretary of State would perform his responsibilities under sections 1, 3 and 51 of the 1977 Act. That is the right, sensible and pragmatic view to take.

Andrew Lansley: Even if it were not a power of direction, the manner in which the clause is drafted could imply an obligation being laid on the independent regulator. For example, if clause 3 said ''in a manner that is consistent with the duties laid on the Secretary of State'' instead of
''in a manner that is consistent with the performance by the Secretary of State of the duties'',
 the question of how the Secretary of State interpreted and performed those duties would appear, according to the statute, to give a power of guidance in relation to the regulator, if not a power of direction. Is that how the Minister sees it?

John Hutton: Yes. That is closer to how the provisions will eventually operate. We must be clear about one important issue: we can will the means, which are methods of improving the national health service by providing more responsive, tailor-made services for patients, but we cannot deny the Secretary of State the means. The danger in the path that the hon. Gentleman wants to go down is that we would end up doing precisely that. With the greatest respect to the hon. Gentleman, I suggest that that would not be a sensible or prudent thing for us to do.
 I know that I have been rather long-winded, but my argument comes down to this: it is the Government's view that the independent regulator should be required to exercise his functions in a manner that is consistent with the Secretary of State's general duties under the 1977 Act, including the duties to promote and provide a comprehensive health service in England and to provide adequate facilities to universities with medical or dental schools. The duties imposed by the provisions of the 1977 Act should be overriding ones because, fundamentally, they will help to ensure that the NHS remains an integrated, coherent and effective national service, and those are important objectives. 
 I think, with respect, that the hon. Gentleman is inviting the Committee to qualify or somehow to dilute those overarching statutory duties, because he is providing several riders or provisos to them. Qualifying or diluting them, which is essentially how the hon. Gentleman's amendments can be interpreted, would be unhelpful. Those general duties should be unencumbered. The hon. Gentleman's amendment would encumber them, and that is why I cannot support it.

Andrew Lansley: I am not sure to which amendments the Minister was referring. I acknowledge that, in practice, amendments Nos. 232 and 107 would qualify the duties. However, I hope that he would not apply that argument to amendment No. 123, which is not intended to qualify the duties laid on the regulator but to give the regulator guidance on how he is to carry
 out his duties. They are not in any sense inconsistent with the general duties.

John Hutton: That is right. I was talking primarily about amendment No. 107. With respect, I am sure that the hon. Gentleman will concede that it is an attempt to qualify the overarching statutory obligations; otherwise I would not be able to understand his amendment at all.
 That is the Government's position on the work of the regulator, and the way in which we have expressed it in the Bill is clear for all hon. Members to see. For those reasons, I cannot support the hon. Gentleman's amendment. 
 The hon. Gentleman moved amendment No. 232, which requires a higher clinical standard and responsiveness to patients. Again, with respect, I hope that he is prepared to accept my assurances that the amendments are not strictly necessary for two reasons: they are already covered by section 1(1) of the 1977 Act, which is clear in that regard; and NHS foundation trusts, like other trusts, have a duty that is set out in clause 40. It states: 
''It is the duty of each NHS body to put and keep in place arrangements for the purpose of monitoring and improving the quality of health care provided by and for that body.''
 Amendment No. 107, which proposes ''freedom from external constraints'', has been dealt with, although perhaps not to the hon. Gentleman's satisfaction. However, I do not wish to replicate the arguments. The amendment may also be unnecessary as NHS foundation trusts' freedoms are properly and effectively guaranteed and they are set out in legislation, particularly in clause 14 and in Government amendments Nos. 148 and 149.

Chris Grayling: Surely the point about amendment No. 232 is that it is, in effect, a reminder to the regulator. We have heard much about the work that the regulator will need to do with trusts in shaping constitutions and in identifying the best way of selecting members across geographical areas. Surely, it must be worthwhile to have a perpetual reminder to the regulator that his prime job is to look after patients and not allow other factors to intervene to prevent that.

John Hutton: No, I absolutely agree with the hon. Gentleman; that is precisely what the Bill does. He described this as a reminder—reminding the regulator of his clear and explicit existing functions. However, with great respect to the hon. Gentleman, I do not think that the Bill, having made those commitments clear and unambiguous, must contain a reminder designed to achieve that. That is not a good principle of drafting legislation in the House.
 The hon. Member for South Cambridgeshire raised a concern in amendment No. 123 about the compact. The hon. Gentleman is a member of the NCVO, and he takes that work very seriously, on which I congratulate him. We strongly support the compact and the spirit of the provisions set out in paragraph (c). However, the amendment is not strictly needed. As the head of a non-ministerial department, and consistent with his common-law duty to behave reasonably and proportionately, the office of the 
 independent regulator would already be expected to work within the compact, as was agreed with the community and voluntary sector in 1998. However, the hon. Gentleman would accept that his amendment would take the compact into completely different legal territory by giving it some statutory backing and making it legally binding. It gets its authority from being jointly endorsed by the Government and by the community and voluntary sector. A trust and partnership working is about relationships, reaching goals and obtaining wider benefits, and I would not want to convert the compact into a statutory creation. 
 Amendment No. 200 is also unnecessary, as the matter has already been dealt under the 1977 Act as incorporated into clause 3. We should not debate that any further. I tried very hard to take notes during the contribution made by the hon. Member for Cheadle on amendment 244, but I completely failed because I did not understand the point of her argument. I do not intend to say anything about it, other than that, from what I can work out, it is an attempt to give the Secretary of State the power to direct the independent regulator, and we do not intend to go down that road.

Andrew Lansley: I am grateful to the Minister for the almost comprehensive way in which he replied to the amendments. I accept, on the grounds of its being implied in section 1 of the 1977 Act, and under clause 40 of the Bill, that higher clinical standard does not need to be specified for the regulator.
 I would accept that the reference to freedom from external constraints and so on—the deregulatory function—does not need to be specified as a duty of the regulator had the Minister gone on to accept that the better regulation principles enunciated in amendment No. 123, under proposed new subsection (2)(a), had been accepted. However, the Minister is not inclined to accept them. That would have delivered not only the deregulatory objective, in so far as regulatory action would be targeted only in cases in which action was needed, but some of the other principles of good regulation would also have been set out. It is wrong that the Minister did not deal with that point in detail, and it is wrong simply to gloss over them and say that they are implied in some way by the practice elsewhere—it has been specified in statute for other regulators.

John Hutton: I apologise to the hon. Gentleman. I have got so many sheets of paper that I overlooked a reference to proposed new paragraph (a). I should like to have said in my speech that the clauses in the Bill have been drafted with a view to establishing a light-touch regulatory approach. If the hon. Gentleman were to look at clause 23, he would notice that the regulator can intervene only where there is a contravention or failure of a significant nature. We do not envisage the regulator's intervening daily in the work of NHS foundation trusts. The office of the regulator has been constructed in accordance with the spirit of the best approach to regulations.

Andrew Lansley: I find that astonishing. In other contexts, Ministers have said that they want to create light-touch regulators and then, as part of the process
 of doing so, have made it clear that the regulator in question will be the subject of the best regulation principles as enunciated by the Better Regulation Task Force. Those principles are built into the Bill.
 The Minister has not presented an argument for not accepting amendment No. 123; he has only said that it is not needed ''because, because'' and then found other examples. That is also true of proposed new paragraph (b). 
 I am sure that one could find places in the Bill in which the regulator might, in authorising services, consider the interests of children or of rural and urban areas; no doubt, the regulator might have regard to the principles set out in the compact. However, in none of those cases is that certain, nor is it likely to be applied across all the functions of the independent regulator unless we set it out in statute that the regulator must have regard to those matters. That is true of the compact itself. 
 Those in the voluntary sector would not think that the regulator's duty to have regard to the various groups' interests would be any more or any less adhered to simply because it was referred to in statute. The issue is whether the Minister is right in telling us that, as a non-ministerial department, the independent regulator is required to have regard to the compact if it is not referred to in statute. My understanding is that regulators who are covered by statutes in which there is no reference to the compact—that has not generally been the case so far—do not have to have regard to it. Perhaps the Minister will tell me that I am wrong, although if we study the matter we might find that he is wrong.

Chris Grayling: In reinforcement of my hon. Friend's argument about the need to strengthen the guidance given to the regulator, is he aware that, as public corporations, foundation trusts can only have functions that are given to them by statute? It is clear from the drafting of the Bill that foundation trusts do not have the power to appeal against a decision made by the regulator. The Bill must be as precise as possible about the duties of the regulator to ensure that there is no breakdown between the regulator and the foundation trusts.

Andrew Lansley: My hon. Friend makes an interesting point that could take us into a completely different territory, which could be the subject of a debate in itself—should there be an appeal mechanism, and under what circumstances might an appeal be made? Presumably, foundation trusts would have scope for a judicial review if they felt that the regulator behaved unreasonably. We would have to wait to see whether an appeal was justified before we judged the merits of the decisions.
 I have heard nothing to convince me that amendment No. 123 is not highly desirable for setting out the issues to which the independent regulator should have regard. Some of the explanations on consistency with duties were quite interesting, and I suspect that when we come to consider the matter later we may conclude that the 
 clause should read: ''He must exercise his functions in a manner consistent with the duties laid upon the Secretary of State as distinct from the performance by the Secretary of State of those duties.'' If we accept the point of my hon. Friend the Member for South-West Devon, there is technically nothing to prevent the legislation setting out the duties again in detail. 
 Given that that is the case, I find myself in the same position as when I began. I shall not seek to press amendments Nos. 232 or 107 to a Division, but I am wholly persuaded of the merits of amendment No. 123. I am surprised that the Government should resist their inclusion in the Bill, as they would help the regulator to do his job in the way that we all wish him to. Therefore I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Amendment proposed: No. 123, in 
clause 3, page 2, line 5, at end add— 
 '(2) In performing his duties under this Act, the regulator must have regard to such of the following as appear to him to be relevant in the circumstances— 
 (a) the principles under which regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases where action is needed, 
 (b) the different needs and interests of persons using NHS services and, in particular, of the different interests of children, and of those living in rural and urban areas; and 
 (c) the principles set out in the Compact between Government and the voluntary sector and the codes of practice set out under it.'.—[Mr. Lansley.]
 Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 14

Question accordingly negatived. 
 Clause 3 ordered to stand part of the Bill.

Clause 4 - Application by NHS trusts

Andrew Lansley: I beg to move amendment No. 103, in
clause 4, page 2, line 8, after 'trust', insert 
 ', a Primary Care Trust, or any combination of trusts,'.

Peter Atkinson: With this it will be convenient to discuss the following amendments: No. 201, in
clause 4, page 2, line 8, after 'trust', insert 
 'or combination of NHS trusts'.
 No. 106, in 
clause 5, page 2, line 31, after 'trust', insert 
 ', Primary Care Trust or combination of trusts'.
 No. 202, in 
clause 5, page 2, line 31, after 'trust', insert 
 'or combination of NHS trusts'.

Andrew Lansley: Clause 4 is about applications—[Interruption.] I thought that the Government had abandoned clause 4, but I am reminded that it was rewritten, and we shall rewrite it again.
 The structure of clause 4 does not cause me any difficulties, although later clauses may. My four amendments have a specific purpose, which is to broaden the scope of those NHS organisations that can apply to become NHS foundation trusts. 
 Amendments Nos. 106 and 202 apply to clause 5 and are consequential on the other two amendments. Therefore the first two in the group, amendments Nos. 103 and 201, are the ones that matter. Amendment No. 103 relates to the beginning of clause 4, which states: 
''An NHS trust may make an application''.
 The amendment proposes to insert after ''NHS trust'' the words, 
''a Primary Care Trust, or any combination of trusts''.
 That amendment takes up one of the principal arguments, which, as the Committee may recall, was discussed in January when the House debated a Conservative motion on hospital foundation trusts. One of the strongest arguments for consideration at that early stage concerned the question of with whom responsibility and accountability should lie—that is, where patients' proper control should lie in the NHS. If, as I hope is the case, NHS patients have a clear mechanism for controlling the structure and the way in which the NHS is delivered in their locality, then primary care trusts are the obvious starting point. Primary care trusts are the commissioning bodies that operate on behalf of patients. 
 I have annual discussions with the primary care trust and the hospitals in my area about service level agreements. Although there is negotiation between the hospital and the primary care trust, technically speaking, the operation is primary care trust-led. However, if the hospital is essentially a monopoly provider—as is the case in some places—and offers services to the primary care trust with the expectation that they must simply take what they are given, we are not getting the primary care-led NHS in the form in which the Government have told us it should be structured. If the NHS is to be primary care-led, it will have to be primary care trust-led, and the involvement and the accountability of patients should be focussed on primary care trusts. I will not argue that point at length because the hon. Member for Oxford, West and Abingdon (Dr. Harris) made a similar argument on an earlier group of amendments, and that was set out then and on Second Reading. 
 I suspect that Ministers must agree, in theory, and are minded to say, ''Make us logical, but not yet.'' They want to keep primary care trusts out, on the grounds that they have only recently been established and therefore need to bed down before being given the opportunity to become NHS foundation trusts. 
 That is slightly odd in two respects. First, the Select Committee report details the frequency with which NHS bodies are subjected to an additional administrative overhaul. The Government's desire to get all the mechanisms of primary care trusts thoroughly bedded down, before digging them all up again and turning them into something different, is perverse. If we know where primary care trusts are travelling, and if that route is one of accountability to patients through direct membership of a foundation trust by NHS patients in their area, why not move there more quickly? Why not quickly make the primary care trusts accountable? 
 Alternatively, the amendment may commend itself to Ministers on the grounds that, although they do not wish to carry it out now, they will wish to do so at some later stage. Unless a later amendment that I support were to succeed, an NHS trust or any other trust could make an application to become a foundation trust only if it were supported by the Secretary of State. If Ministers want to hold primary care trusts back—even for years—there is absolutely nothing to stop them doing so.

Adrian Bailey: I follow the logic of the hon. Gentleman's argument, and I concede that there is something in it. However, does he not recognise that when an essentially new concept is introduced—local involvement in the provision of health care—it is sensible to make that provision for the body that local people most readily understand, identify with and want to get involved with? If that were set up and working well, it would be much easier to make other elements of health service organisation and provision more democratic by using the first as an example and inspiration.
 To put it simply, were I to ask people on the streets of West Bromwich whether they wanted to get involved in the running of the local Sandwell hospital, I could be quite sure of a favourable reply. However, if I were to ask people whether they wanted to get involved with the running of Oldbury and Smethwick PCT, I should be met only with blank looks. That approach tries to surmount that difficulty.

Andrew Lansley: I understand the hon. Gentleman's point; however, it is essentially an issue of timing and phasing in rather than of principle. In his argument, the hon. Gentleman does not dispute that, if we seek accountability to patients and patients exercising greater influence over the structure of services provided to them, it must be done through primary care trusts.
 The question then becomes how to reach the point at which the public understand the nature and the role of primary care trusts. As someone—perhaps my hon. Friend the Member for Westbury (Dr. Murrison)—said from a sedentary position, patients encounter their GPs much more frequently than they do their hospital. During a year, many more patients see their GP than attend hospital. Although we have the physical appreciation of the hospital, if, over time, one wanted to create among patients an understanding of the nature of a primary care trust and the role that it 
 fulfils, so that they had an impetus towards participation in membership, it would not take long for GPs to create that sense of awareness and impetus in their population. That would depend on GPs being minded to give their support, but I suspect that for an application to be submitted the area's GPs would have to go in that direction. 
 We do not say that all must become foundation trusts in a particular time frame—or perhaps Ministers do take that view. My view has always been that devolved management must have a degree of organic growth. I am not sure that I subscribe to the argument of the hon. Member for West Bromwich, West (Mr. Bailey), but it can be contemplated. However, even if the hon. Gentleman is right, primary care trusts themselves can hold back because, at this stage, they do not think that the public know enough about them to wish to become members. Ministers, too, can hold primary care trusts back. 
 The second limb of my argument concerns whether it makes sense to leave them out of the legislation. As far as I can see, if they were left out now, we would need new primary legislation to reintroduce them. From past experience, we know that that can be a significant constraint on the timetable and the development of services to patients if structural change is required.

George Young: My hon. Friend will recall that, on Second Reading, the Secretary of State, when pressed on that point, said:
''Down the line, I have no objection whatever to the idea of applying the democratic or foundation principle to primary care trusts.''—[Official Report, 7 May 2003; Vol. 404, c. 705.]

Andrew Lansley: I do recall that the Secretary of State said that. I also recall that later I asked him similar questions on a different subject, but I shall come to that in a moment.
 As my right hon. Friend makes clear, if the Secretary of State was willing to say that on Second Reading, logic tells us to include primary care trusts in the clause and make it possible for those to become foundation trusts. If Ministers are not ready for that to happen, it can be held back using the discretion that Ministers have.

Andrew Murrison: We must assume that there is a purpose in not including primary care trusts in the Bill. Does my hon. Friend agree that one reason could be that the Secretary of State, because he is very clever, perceives that control is through the primary care trusts? Given that 75 per cent. of NHS funding goes through primary care trusts, is that a way to maintain control, while, on the face of it, devolving power to foundation hospitals?

Andrew Lansley: My hon. Friend makes an important point. If Ministers are not minded to accept the amendment, they will have to explain why. I am not by nature someone who is given to conspiracy theories, but the Minister asserted on several amendments that Ministers will not have powers of direction or control and that foundation trusts will have operational and organisational freedom. However, that freedom can be
 exercised only to the extent that the foundation trusts are commissioned, and the role of the Secretary of State in directing the commissioning bodies is a powerful one.

Gary Streeter: Does my hon. Friend agree that the Government might be putting the cart before the horse? If a primary care trust were to become a foundation trust with local accountability, democracy and ownership, it would be the unit that buys in services from hospitals and it would not commission services from hospitals that did not deliver high-quality services. That would create gaps in the market for other provision to come forward. One way to control the quality of services in hospitals would be to set primary care trusts free, so we might not have to go down the foundation trust route at all.
Mr. Lansley rose—

Gary Streeter: Just say yes.

Andrew Lansley: I will say yes to the first half, but not to the second. I see merit in giving operational freedom to hospitals, as distinct from the benefits that would accrue from the additional accountability to patients if primary care trusts had the chance to become NHS trusts.
 The structure of amendment No. 103 would allow primary care trusts to be piloted as NHS foundation trusts. We have first-wave foundation hospitals, but the impetus behind the first wave is such that it draws Ministers into the expectation that all hospitals will become foundation hospital trusts. However, I am sure that they would acknowledge that, in practice, piloting some of the changes is important. 
 If the legislation is changed to allow primary care trusts to become foundation trusts, it may be possible to engage in a pilot study with PCTs—consistent with the Bill—in one or two places, without creating the expectation that all primary care trusts will get there. However, if we take the path of legislating again for PCTs to become foundation trusts, that will imply that Ministers have decided that that is the route for all primary care trusts to take. 
 There is a further limb to amendment No. 103, but that may have to wait. 
 Sitting suspended for a Division in the House. 
 On resuming—

Andrew Lansley: I was just coming to the final limb of the argument in support of amendment No. 103. It will be obvious to the Committee that if the language were changed so that an NHS trust,
''a Primary Care Trust, or any combination of trusts''
 were able to make an application, that would mean that PCTs and NHS trusts together could make an application to become an NHS foundation trust. I am motivated in this direction not least by the arguments of the King's Fund. I have great respect for its work, and appreciate its argument that one model for the restructuring of accountability in the NHS could be the creation of a whole health economy foundation 
 trust. If one were to go down that path, one would need the PCT and the hospital trust to be able to come together to create a single foundation trust. That would be acceptable only in circumstances in which further progress had been made in extending patient choice, which is being contemplated to some extent in ministerial thinking. If that progress were made, we could consider such a model, in particular for urban areas, because it would not be monopoly provision. 
 At this stage, Ministers are looking for different models of structure to develop the NHS in different places. The structure of the legislation does not at the moment permit either PCTs, or PCTs and NHS trusts together, to respond in accordance with their local circumstances. 
 There is an alternative, which is addressed in amendment No. 201. The amendment would mean that an NHS trust, 
''or combination of NHS trusts'',
 may make an application to the regulator. Amendment No. 103 encompasses this amendment, but No. 201 is separated out for a reason. 
 In some parts of the country, hospitals have come together when NHS trusts have been established to create combined hospitals trusts. I think that one or two of those might be on the list of those that applied for foundation status—certainly, the Bradford Hospitals NHS trust is one that did and it has more than one hospital, and the Gloucestershire Hospitals NHS trust is another. East Cheshire NHS trust was another, but it has not pursued its application at this stage. 
 It is a consequence of past events that some hospitals have come together to form NHS trusts, and others have stayed as distinct and separate trusts, not part of one organisation. That is a bar to hospitals coming together to create an NHS foundation trust and restructuring themselves locally. My constituency has a particular interest there, because in order to reconfigure its services to respond to patients' needs—I made this point on Second Reading—Addenbrooke's hospital could choose to work with, say, West Suffolk hospital, the Hinchingbrooke hospital in Huntingdon or other local hospitals to create a new structure of services: those at the Addenbrooke's site might focus on the most serious illnesses, while some of the elective surgery and other functions could be redistributed to other sites, making the services more accessible to patients. Patients' needs might well be met more effectively that way. 
 If Addenbrooke's were to become a foundation trust at a point when the other hospitals had not yet become foundation trusts or, in the fullness of time, they become different foundation trusts, we may be creating barriers. Moreover, we may be creating a curious situation for patients, in which, for example, they are members of the Addenbrooke's foundation trust and, in the fullness of time, they might also become a member of the West Suffolk NHS foundation trust; both would be a hospital to which they might go for different reasons. Although a member of my constituency as a patient might think that those two things were complementary, in practice 
 the two boards would have no mechanism for taking their decisions together. There would be the co-operation provisions, but they would be separate boards making separate decisions. 
 With the amendment I am opening up the possibility of NHS trusts thinking hard about the structure of an NHS foundation trust and how it can best serve their locality, sometimes by the reconfiguration of services across several hospitals. The amendment is designed to address that point, without the further complication of primary care trusts at this stage. I hope that Ministers will recognise that this is not intended simply as a probing amendment. It is intended as a serious set of amendments, proposing two options as to how one might proceed. The first amendment, which attracted much support on Second Reading and in Committee debates, relates to the principal of how foundation trusts should be established. The second amendment proposes a practical option in relation to the structure that Ministers are currently considering. It does what they seem to be in favour of—that is, it allows trusts to set up local arrangements that, in their view, are better able to meet the service needs of patients in their area.

Chris Grayling: I want to say a few things in response to the interesting set of amendments tabled by my hon. Friend the Member for South Cambridgeshire. He has put his finger on one of the clearest issues arising from the structures that have been put in place by the Government under the Bill—that is, that there is a coherent argument to say that the democratic model that is being phased in to the NHS is in the wrong place. It is logical that there should be a debate over whether primary care trusts should enjoy the same rights as foundation trusts, as set out under the Bill. It is an irony that in many ways the primary care trusts themselves will lose freedoms as a result of the establishment of foundation hospitals in the way that the Government have envisaged it. That is because the Government envisage establishing—Ministers will correct me if they have changed those plans—long-term contracts between primary care trusts and foundation hospitals to secure the financial solidity of the foundation hospital trusts, once established. The effect of that will be to reduce the freedoms that primary care trusts enjoy to secure the treatments of choice of their patients. It requires them to follow a fixed balance between secondary and primary care. It will inevitably reduce their ability to move services into the primary care sector, which is ironic because part of the core of the Government's strategy for the NHS, most recently articulated in ''Keeping the NHS Local'', is to begin to move services out of acute hospitals into primary care. If the primary care trusts lose freedoms as a result of the changes, it is not clear how they will be able to do that.
 I can envisage that one of the challenges that Ministers will face in the years ahead under the structure they are establishing is a degree of tension between acute and primary care trusts as they seek to implement the strategy outlined in ''Keeping the NHS Local''. There is a clear argument, which merits further debate, that the democratic element of local 
 NHS structures should relate to the area where decisions are made about care. 
 Community decision making should be setting priorities about services in local health care purchasing; it should be deciding the priority between, for example, an additional focus on mental health care, orthopaedic care, stronger community-based services, or strengthening acute-based services. With the foundation hospital structure alone that will not be possible. If there were greater community participation in primary care trusts and other kinds of NHS trusts, people would be afforded the opportunity of having a stronger say in decision making about the allocation of health care resources in their community. The range and portfolio of services would not then simply be decided within a hospital.

Evan Harris: On the theme that the hon. Gentleman is pursuing, does he recognise that that is exactly what happens in social services, despite the constraints on local authorities? Not only can local people vote for a programme to be provided under different proposals put by various parties, but the local revenue-raising powers, limited though they are, can be used to ensure that extra priority is given, without having to take social services from another vulnerable group in order to fund it. Does the hon. Gentleman think that there is merit in that, and would that be transferable in any circumstances to health care commissioning?

Chris Grayling: One of the great dilemmas faced by many social services departments is that their freedom to manoeuvre is constrained by statute. There are many parts of the country in which decision making has to be skewed one way or another, because central Government diktat requires it. Local authorities do not enjoy the freedom to make decisions without their having to make especially difficult financial decisions that may have an adverse effect on the elderly, for example, through substantial council tax increases. I suspect that that line of argument is not entirely in line with the nature of the amendments, so I will avoid being drawn too far down that road.
 My hon. Friend the Member for South Cambridgeshire made an interesting point about the combination of trusts. It is conceivable that ambulance and acute trusts may move closer together in future to ensure a more seamless and effective delivery of services and a better allocation to the correct place in the NHS of patients who summon an ambulance. At the moment, there are frictions in the NHS between accident and emergency trusts and ambulance trusts over the admission of patients. It is conceivable that in future there will be much greater collaboration between, and possibly even the unification of, hospital and ambulance trusts to create a seamless system for the handling, admission and treatment of patients coming through the emergency access channels into the NHS. 
 I commend my hon. Friend on raising an important issue. The Government should leave the door open. There is an important point about the Bill effectively excluding the extension of the foundation principle in the NHS, without the need to come back to the House 
 to discuss the matter further. It is not necessary to have an additional piece of legislation to allow the Government to extend the foundation model if they wish; all they have to do is leave the option open in the legislation. Like my hon. Friend, I am interested to hear the response of Ministers, especially after the comments of the Secretary of State on Second Reading. I would like to hear something about how the Government envisages the foundation model developing further in the NHS and why the Bill does not permit that in a managed way.

Evan Harris: I should be grateful if the Minister could confirm that if a PCT were to seek foundation status, that further legislation would be needed. That was not discussed in detail on Second Reading. It was implied that that was a question for later and that it was necessary to start with NHS hospital trusts. Can the Minister help to curtail the debate by clarifying that that is the case? It is a reasonable question. Clause 4(1) deals with an NHS trust that makes an application, and clause 5(1) states that an application may be directed by
''persons other than NHS trusts''.
 That seems to cover all options. 
 A PCT could be considered to be either an NHS trust—although I do not believe that it is in law—or something other than an NHS trust. When I first saw the hon. Member for South Cambridgeshire's amendments, I thought that they were not necessary because that matter would be dealt with under clause 5. I hope that the Minister will put me out of my confusion on that matter. The explanatory notes to clause 5 state that 
''This clause allows persons other than NHS trusts'',
 which I assume to mean PCTs, 
''to apply to set up an NHS foundation trust. They may only do so with the support of the Secretary of State.''
 We know what we think about that matter. The explanatory notes continue: 
''This allows organisations that are not currently part of the NHS such as charities and voluntary sector organisations to become involved in the establishment of a new NHS foundation trust.''
 That does not preclude that explanation. It applies to PCTs. Perhaps there is some clarification on that matter.

George Young: I was hoping that the Minister would provide the hon. Gentleman with the answer. The answer lies in clause 1, where a foundation trust is defined as an organisation that provides goods and services. As a PCT does not supply goods and services, it is excluded by clause 1.

Evan Harris: I am grateful to the hon. Gentleman for his response, as we always are. PCTs provide goods and services. They are providers of primary care. Under GMS and personal medical services no goods and services are more direct than primary care. Will the Minister curtail that part of the debate by clarifying that issue?

John Hutton: I wish it were in my power to curtail the debate but I do no think that it is.

Andrew Lansley: It is an important debate.

John Hutton: It is a very important debate. I want to confine my remarks to my response to it, rather than intervene at that point. The difficulty I have is that both the right hon. Member for North-West Hampshire and the hon. Member for Oxford, West and Abingdon are partly right. Primary care trusts are not solely commissioners, they are providers. In relation to the provider aspects of PCTs, they are broadly within the scope of the Bill. The commissioning function clearly is not. I hope that answers the hon. Gentleman's point.

Evan Harris: I am pleased that the Minister is talking about the provider function. We have tabled an amendment on clause 5—which is not in this group—that clarifies the issue, and which would allow other bodies such as PCTs to become public benefit corporations, provided that they do not commission services.
 The Minister says that that amendment is not necessary because of clause 1, and that PCTs would fall under clause 5, despite the fact that the explanatory notes do not specify that. Some of the hon. Member for South Cambridgeshire's points would not apply in that respect. I would be interested in the Minister's full exposition of that point. It is useful that we now know that. We might have saved time if we had understood that point at an earlier stage. We will wait to hear what the Minister says on that matter. 
 The other point that I will make concerns issues relating to the commissioning and providing sides. I was delighted to hear the hon. Member for Epsom and Ewell say that to a certain extent—I am quoting him broadly, not exactly—democratisation is occurring first in the wrong place. That is because of the importance of the commissioning role in the NHS, as the hon. Member for South Cambridgeshire stated. If nobody is interested in commissioning, other than in cases where there is a monopoly suppler and the split between commissioner and provider is not working well—that is an internal market, even if the Government deny that—the commissioners have the upper hand. 
 In another debate the Under-Secretary stated that commissioners have a powerful hand in that matter. That is why it is important that democratisation takes place on the commissioning side. However, I do not believe that giving foundation status is the best way to go about that; if democratisation is needed on the commissioning side, the best way to provide it is by holding elections to a public body, whether it be a health board or a local authority, or having revenue-raising or tax-varying powers so that the priorities that the hon. Member for Epsom and Ewell talked about could be met. He makes the fair point that council tax is not a pleasant tax for older people. There is an alternative, which I shall not go into at this stage, and that is local income tax. 
 We would like the democratisation to apply to the commissioning side of PCTs, but the mutual aspect of foundation status could easily apply to the primary care services provided by a PCT. We envisage PCTs 
 returning to being providers and advisers of the commissioners. 
 To a certain extent, the hon. Member for West Bromwich, West did not exactly recognise the truth, although I partly understand where he was coming from. The services that most people use, see first, use most frequently, are most local and most useful to them are GP services. It is true that, as the hon. Member for West Bromwich, West said, if someone was asked whether they would be more interested in running their local hospital or their local PCT, they might opt for the former because of the over-concentration on acute services and secondary care services. However, in reality, we all have a duty and a role to raise the status of primary care, so that when people think about the NHS in their area, they think about GP services as much as they do about their hospital.

Adrian Bailey: I am quite happy to take the point that people use GP services more than the hospital, but PCTs are not just about GP services. It is a different body. If we are to enthuse people about participating in health provision, it is better to start with the service that they understand and identify with most readily. I still think that that amounts to the hospital.

Evan Harris: I understand the hon. Gentleman's point, but I would argue that more people have direct experience of general practice. As far as the provider of service is concerned, PCTs should not be seen as anything other than a way for providers to get together to provide a service. In my view—this is why I did not support the establishment of PCTs, as the record will show—in the early provision, PCTs should not have been confused with the commissioning role that will be best placed with a democratically based, and not a more democratically based, organisation.
 I have half-sympathy with the hon. Gentleman, in that we would welcome finding a way of ensuring that the non-commissioning functions of primary care trusts were available for mutualisation, or them becoming public benefit organisations, rather like housing associations, in a way. 
 However, I think that two stages are required: first, the commissioning function must be split from the providing function, and secondly, as a priority, there must be a democratisation of the powerful, responsive, accountable commissioning function. Then we can consider the issue. That is what we Liberal Democrats have always wanted to happen before we get involved in the detail of exactly what shape the mixed market in providers will take. It is more urgent to sort out the commissioning side. Part of this debate is academic, because the Minister may pursue the course that he hinted at earlier, under which clause 5 would apply to the provider side of the role of PCTs. 
 It is for those reasons that we do not support the proposal of the hon. Member for South Cambridgeshire, but I thank him for the clear way that he set it out, and for the interest that he has taken in the importance of ensuring that the primary care side of the NHS is not forgotten in our debates.

George Young: I am particularly interested in amendment No. 106, which brings primary care trusts within the enfranchising part of the Bill.
 Once again, I pray in aid the report of the Select Committee. So far, whenever I have tabled an amendment that is based on a Select Committee recommendation, it has been dismissed with a wave of the hand by the Minister—the last time, a few words were said on amendment No. 200. 
 Page 49 of the Select Committee report states: 
''We also recommend that the Government considers a wider democratic option for trusts, including PCTs, to consider with or without the freedoms associated with the current foundation model.''
 Therefore, its view is that they should be brought within the framework of the Bill. 
 Paragraph 168 states: 
''Equally, to ensure a genuine level playing field across the NHS, the needs of mental health trusts, ambulance trusts and primary care trusts must all be taken into account.''
 I agree with what my hon. Friend the Member for South Cambridgeshire said at the beginning of this debate. In a sense, the Government are democratising the wrong body. If we had gone back to the model that we had 30 or 40 years ago, where the budget went from the Department of Health to the local hospital, which then decided what services would be provided, there would be some validity in doing what the Government are doing—making the hospital accountable with regard to the needs of the local community. However, in between times, we have had the split between the purchaser and the provider, and it is the provider rather than the purchaser that has been exposed to the new forms of social governance. 
 The situation has been made worse by Ministers using careless language: they have implied that what they are doing will alter the services that are being provided locally. In his foundation hospital speech of 30 April, the Secretary of State said: 
''By all means let us debate NHS foundation trusts but let us do so on the basis of what the policy is rather than what it is not. Greater local freedom, real local ownership, genuine staff involvement to give more responsive services and ensure community needs are better met.''
 The more responsive services are a matter for the primary care trust. 
 On Second Reading, the Secretary of State admitted: 
''Primary care trusts will continue to have the power to use their resources as they see fit.''—[Official Report, 7 May 2003; Vol. 404, c. 711.]
 Therefore, it is the primary care trusts rather than the foundation trusts that will shape the services that the community gets. That is why I have a lot of sympathy with the argument, which was deployed on Second Reading by many Labour Members, that the primary care trusts rather than the hospitals should be exposed to democratic accountability. 
 In response to that, the Secretary of State has shifted his position as he has come under pressure. That was particularly the case during the debate. I have to hand the quote that I used when I intervened 
 on my hon. Friend the Member for South Cambridgeshire. The right hon. Gentleman said: 
''Down the line, I have no objection whatever to the idea of applying the democratic or foundation principle to primary care trusts.''—[Official Report, 7 May 2003; Vol. 404, c. 705.]
 Given that that is the Government's policy, it is odd for legislation to go through that precludes that. We have the perverse position whereby a hospital trust that does not want to become a foundation trust will have to do so because they all must do so within a certain period, but a primary care trust that would like to enfranchise itself under this process is not allowed to do so. If one wants to make the NHS more accountable to local people, why does one have legislation before the House that ensures that a PCT cannot become democratically accountable? 
 Therefore, I have a lot of sympathy with amendment No. 106. It would preserve the flexibility that the Government want. Under clause 5, it is not possible to apply to become trusts unless applications are supported by the Secretary of State. If it is the Secretary of State's view that these are fragile organisations that are not quite ready for that, he can simply not validate an application under clause 5. However, it would be sensible and avoid primary legislation if we were to agree to amendment No. 106, or a similar one. 
 The view of the Select Committee, a number of Labour Members on Second Reading and many Opposition Members should be accepted: to do so could save the Government some time in a few years.

John Hutton: Again, I find myself in the position of welcoming this debate and congratulating the hon. Members who have spoken.
 The hon. Member for South Cambridgeshire started his argument from the point at which I should start mine: a sensible position. He does not want the Bill to create further barriers between different parts of the NHS, and nor do I. For reasons that I shall outline, that is not what the Bill will do. He does not want the Bill to act as a deterrent to planning and proper strategic development across the NHS; it will not do so. 
 The right hon. Member for North-West Hampshire said that I had dismissed out of hand the Health Committee's report, but I have not. We hold that Select Committee in the highest regard, and we will carefully consider its report on NHS foundation trusts. On several occasions, the hon. Gentleman invited me—tantalisingly—to respond to certain recommendations in the report. With the greatest respect, he knows that it would not be appropriate for me to pre-empt the Government' response to the report. He might be delighted to hear my thoughts on the subject, but he will have to contain himself until the appropriate moment; wisdom and light will then shine upon him, and we will all be happier individuals as a result.

George Young: Is the Minister seriously saying that we will debate the Bill, even though the Health Committee has produced a report with a number of recommendations to which the Government will not respond until after the Bill has left Committee?

John Hutton: It is true that the Government's response to the report will not be made until the Standing Committee is over.

Jim Dowd: One of the reasons why the timetable of the report was so tight vis-à-vis Second Reading was the delays in getting the report out because of the deliberative sessions. It could have been out much sooner, and the Government's response could therefore have been produced before Second Reading, but the Committee's deliberations made that impossible.

John Hutton: I am grateful to my hon. Friend. I am sure that many of us, including myself, would have liked to have listened in on those deliberations.
 The right hon. Gentleman quoted various paragraphs of the Select Committee report, and, in response, I am giving the Government's view on those issues that are pertinent to the Bill. I am not dismissing the contents of the report, but nor is the report influencing our debate or shaping my responses. As the hon. Member for South Cambridgeshire made clear, the Health Committee felt that the Bill should address the issues that he raises. I shall respond to those particular points, and, in the process, cast light on the Government's view on some aspects of the report. 
 I shall treat amendments Nos. 201 and 202 together because they relate to combinations of NHS trusts applying for NHS foundation trust status. I shall also deal with the wider point of primary care trust applications for foundation trust status. Without running through the history and background to the Bill, in a nutshell we are establishing a new form of governance for NHS trusts that is independent of Whitehall control. That is one part of the wider programme of system reform that is needed to deliver our strategy in the NHS plan. 
 The Bill is not designed to be a backdoor route to large-scale service reconfiguration, which must be considered properly in the context of wider policy development. As my right hon. Friend the Secretary of State made clear on Second Reading, the Bill envisages one NHS trust becoming one NHS foundation trust. Anyone reading the Bill will see that we have clearly set out that process in part 1. The Secretary of State also made it clear that different configurations might be considered, although he rightly counselled caution. Our top priority is to ensure that NHS foundation trusts work before we move to adopt different models. 
 Any configuration would have to take place according to current arrangements before an application could be made to establish an NHS foundation trust. There needs to be consultation, not only on a proposal to apply for NHS foundation trust status—I shall come to that when we consider clause 6—but on the whole package, including the proposal to merge two NHS bodies. The organisations involved would need to satisfy the consultation provisions in clauses 6 and 7, the regulations on consultation for dissolution of NHS trusts and section 11 of the Health and Social Care Act 2001. Section 11 places a duty on NHS bodies responsible for services to involve and consult patients and the public on the planning of services, their development and proposals 
 for service change, and on decisions that may affect the operation of those services. 
 Further, under regulations made under section 7 of the same Act, NHS bodies that are considering a proposal for a substantial development or a variation of their health services must consult the overview and scrutiny committee of the relevant local authority. 
 I will translate that into plain English: I need to do so for my own purposes, let alone anyone else's. During the course of discussions within local health economies, it is possible for more than one NHS acute trust to come to the view that they wish to apply for NHS foundation trust status, and that they wish to do so as part of a programme of bringing together the provision of acute services in the locality. Under the Bill, it is possible to do that. However, there is a difficulty. 
 Because of the way in which the Bill is constructed, the process of NHS acute trust merger will have to run in parallel or coterminously with the application to establish an NHS foundation trust. The provisions about authorisation in clause 6 make it clear that the independent regulator of NHS foundation trusts can only authorise the trust that applied for foundation trust status to be a foundation trust. I am sure that the hon. Member for South Cambridgeshire can see the difficulty. Two acute trusts are applying separately, but with the intention that at the end of the process there will be an acute trust merger and that the merged trust will become an NHS foundation trust. Under the Bill, only the merged trust can be authorised to become an NHS foundation trust, so the merger would have to precede the authorisation under clause 6. 
 That might not be the process that the hon. Gentleman wants, and I share some of his frustrations about it. I do not want unnecessary bureaucracy to come out of this legislation. However, it is clear that we cannot look at this subject only in terms of the Bill: we have to look at it against the background of the wider legislation on NHS trusts, including that on trust mergers. An acute trust merger would be a significant service change, so there would have to be a process of consultation about it. We cannot escape that. If that is part of the process of more than one NHS trust wanting to become an NHS foundation trust, it will have to be gone through.

Andrew Lansley: I do not wish to put barriers in the way of configuration, and I accept that that would need proper consideration through all the mechanisms of the independent panel, the regulator and so forth, but there is something that I still do not understand. If, for example, a first wave foundation trust wished at a subsequent stage to add by way of merger other acute trusts or smaller hospitals in its area which themselves wanted to apply to be foundation trusts, I cannot see how the Bill allows that to happen. Does the regulator have the power to entertain a subsequent application to become part of a pre-existing foundation trust from other NHS trusts?

John Hutton: I will have to take legal advice about that from my officials. Perhaps we can return to the matter at a later stage of our proceedings?
 I think that this is the question that the hon. Gentleman is asking: if there is a pre-existing NHS foundation trust that, having had a process of consultation with other acute trust advisers, wants to merge its services with those of existing trusts that are not NHS foundation trusts, would there then need to be a separate NHS foundation trust application to the regulator? I will have to get back to him on that, as I do not want to risk misleading the Committee.

Chris Grayling: Before the Minister moves on from reconfiguration, can I ask him to address the question of the reconfiguration of services that would result from the ''Keeping the NHS Local'' strategy, and the relationships between PCTs and foundation trusts in such a situation?

John Hutton: There is absolutely nothing in the Bill that makes the ''Keeping the NHS Local'' strategy impossible to deliver. Service reconfiguration will be dealt with in the way that already applies to non-NHS-foundation trusts and, under the Bill, service reconfigurations will need to go through the oversight and scrutiny committees of the local authorities and then be referred up to the regulator for him to decide. In the process, the independent regulator can refer such a decision to the independent reconfigurations panel, which will consider the guidance and ''Keeping the NHS Local'' in coming to a view.

Stephen McCabe: I detect a mood of support in Committee for the process. I hear people saying that we do not want to be unnecessarily restrictive, given that the purpose of the measure is to give people a chance to be innovative, to use capacity in the best possible way and expand it, and to be more responsive to patient needs. However, when my right hon. Friend the Minister described the situation, it sounded as if he himself was acknowledging that the process is unnecessarily rigid and complex under the Bill, in terms of achieving the combination that we are seeking.
 As the Minister is going to seek legal advice to answer an earlier point, will he also consider whether there is a way of simplifying the process, so that we can achieve the ends, on which there is some consensus? Will he report back on that?

John Hutton: Yes, I will certainly do that. However we get there, and whatever adjustments we might want to consider, one thing is reasonably clear: if acute trusts wish to apply jointly to become a foundation trust, we will end up with one NHS foundation trust. There will have to be a way, facilitated through one process or another, whereby the several trusts become one.

Stephen McCabe: And the simpler the better.

John Hutton: Yes, that is absolutely right, but whichever way we cut it, a proper process will need to be followed, and that process is already set out in existing legislation for an acute trust merger. Of course, I do not want an overly bureaucratic process; I eschew that approach altogether. However, we must
 enter into this discussion with our eyes open, and must realise that, however we care to look at it, this is quite a complicated legal and organisational process. I want to find the simplest way through it.
 I tell the hon. Member for South Cambridgeshire and the Committee that there is an obvious way for the several acute trusts to do that—they can go through the merger process and apply to be established as an NHS foundation trust. That is perfectly possible. Nothing in the Bill precludes that from being a way forward. I suggest to my hon. Friend the Member for Birmingham, Hall Green (Mr. McCabe) that that is perhaps the simplest way to cut through the problems. 
 Obviously, such decisions will, in the first instance, be taken locally—and rightly so. However, I enter a precautionary note: if we are talking about multiple acute trusts coming together to form one large super-trust, we must remember that the wider we cast the net in terms of acute trust reconfigurations, the further we are moving in a difficult direction. We would probably be taking the foundation trust further away from the local communities that we are considering. The hon. Member for South Cambridgeshire might think about a Cambridgeshire-wide NHS foundation trust. We start from a large pool of potential operations.

Stephen McCabe: I understand what my right hon. Friend is saying, but surely what he describes would have to be approved by both the regulator and the Secretary of State. It is highly unlikely that he would agree to a super-trust that takes away from local areas, as the purpose of the scheme is to give freedom at local level.

John Hutton: I agree absolutely. I am sorry if I am labouring the point, but my hon. Friend has, in his characteristic way, helped me out significantly; we need to consider the matter in context. How big an issue will it be for the NHS in the immediate and medium-term future? I do not think that it will be the big issue on how we take forward the policy on NHS foundation trusts. The model that we had in mind when we set out on this path was the single NHS trust applying to be, and becoming, the new NHS foundation trust. If one considers the first and second waves, that is how the model will develop.
 However, I agree with the hon. Member for South Cambridgeshire, in that I do not want to put an artificial break on discussions about the best way that local services can be put together. Those discussions should always take place locally. If a combination of acute trusts wants to go down the route that the hon. Gentleman says they might want to, I would not want to get in the way of that, and neither would my right hon. Friend the Secretary of State. 
 I am grateful to my hon. Friend the Member for Birmingham, Hall Green for giving us a bit of context. I have said to him, and the Committee, that we will look carefully at the procedures to ensure that they are the most streamlined that we can develop and devise, and if there is a need to come back with changes on Report, we will consider that. 
 There is a way forward, as I suggested to the hon. Member for South Cambridgeshire, through a merger and the merged trusts applying to become an NHS 
 foundation trust. If there is one obvious way through the difficulties, that is probably it. With respect to the hon. Gentleman, his amendments Nos. 103 and 106, which would allow primary care trusts, or groups of trusts, to apply for NHS foundation trust status were of more substance. 
 The right hon. Member for North-West Hampshire was, as always, correct in his intervention on the hon. Member for Oxford, West and Abingdon. The model set out in the Bill was designed with provider organisations in mind. The Bill requires that the principle purpose of any NHS foundation trust is the provision of NHS services. That is true in clause 1(1), to which he referred, and in clauses 5(2)(a) and 14(2). As the Secretary of State made it clear on Second Reading, we have no objection in principle to applying democratic or foundation principles to primary care trusts. However, we want to do that carefully at the right time. We have started the process at the logical place, which is, as my hon. Friend the Member for West Bromwich, West has made repeatedly clear in effective interventions, with NHS hospitals. 
 PCTs are new, embryonic organisations that are not yet ready to go through that stage of change. If and when we decide that that should be so, we will need to bring forward specific, separate legislation. The right hon. Member for North-West Hampshire has bemoaned the perpetual revolution in the NHS—the constant organisational change. I say to him that about half of the primary care trusts in England are barely a year old. It is fair to give them time to develop and mature. 
 Primary care trusts could not become NHS trusts for the reasons I have set out. That does not, however, rule out consideration on a case-by-case basis of whether it would make sense for a provider arm, or an element of the primary care trust, to establish partnership arrangements with an NHS foundation trust. For example, it might even be possible under clauses 4 and 5—ahead of the application process—for a service reconfiguration to be planned with that end in mind. The provider elements of a primary care trust might merge with the acute trust and the new acute trust would apply to the independent regulator for foundation trust status.

Evan Harris: The Minister was speaking very quickly when he listed the areas in which he felt that an existing primary care trust that provides and commissions would not qualify. He referred to clause 1, but I do not think that it is contained in that clause. I may be wrong. There may be another relevant area. However, the primary or predominant purpose of the provider has to be provision, rather than commissioning. Although I understand that the Government and the Secretary of State would resist a PCT applying, I am not clear whether it would need additional legislation. When the Secretary of State feels that the time is right, given the pressure on parliamentary time, could not the Secretary of State say that clause 5 applies to a PCT, at least in terms of its provider function?

John Hutton: With respect, the hon. Gentleman may not have heard me. Perhaps I was speaking too quickly. I apologise to the hon. Member for Oxford,
 West and Abingdon and to the Hansard reporters, who always have a job of work to do when I speak.
 The point I am trying to make is this. Under the terms of the Bill—clauses 1, 5 and 14—the principle purpose of the applicant for foundation trust status has to be the provision of NHS services. That could not be said to be the principle purpose of a primary care trust. The hon. Gentleman should look at clause 14 if he has any doubts about that. He might also consider clause 1(1), which makes it clear that the provision of NHS services is the principle purpose of the NHS foundation trust. 
 Primary care trusts, which have a commissioning role and some elements of the provider responsibility, do not meet that condition. Under the Bill as currently drafted, primary care trusts in commissioning roles would not be eligible to apply for foundation trust status. I am trying to make it clear to the Committee that the provider elements of a primary care trust could, under clauses 4 or 5—depending on how the application proceeded—be eligible to form part of a joint application with an NHS acute trust to become an NHS foundation trust. That is entirely sensible. 
 This has been an important debate. The hon. Member for South Cambridgeshire has hit on an important issue of principle. As my right hon. Friend the Secretary of State has made clear, we have no objection to the concept of applying foundation trust status to primary care trusts. The issue is when, not whether. The question is whether the Bill is the right model for the Government structure to use. Those are issues that still need to be resolved. 
 It does not make sense at the present stage in the development of primary care trusts to passport them into the legislation in the way that the hon. Member for South Cambridgeshire is suggesting. There is a way through his concern about joint applications from several acute trusts. Perhaps it is not the best and most streamlined piece of engineering. We will have a look at it to see if there is any way in which it can be improved. 
 On balance, many Labour members would take with a pinch of salt the Opposition's new-found passion for democratising the NHS, which has now manifested itself in the desire to find a way of democratising primary care trusts. I do not recall such a desire appearing in any official policy document produced by the Conservative party in all the time that I have been a Health Minister. I readily acknowledge that I do not trawl the internet for that sort of material. Perhaps when the hon. Gentleman responds, he will point out to me the document that identifies the new-found passion for democratising the NHS, and we look forward to that.

Andrew Murrison: I am grateful to the Minister for giving way on that point, because I should be fascinated to know where in the 2001 Labour manifesto foundation hospitals were mentioned.

John Hutton: I can point out to the hon. Gentleman that there are several parts of my party's manifesto that I read—although I am not sure that he did—
 where we talked about increasing the representation of the public on the boards of NHS trusts. That is what the Bill will do. Obviously, the hon. Gentleman has had some sort of episode, because he usually follows our procedures very carefully.
 It has been a longer debate than I should have preferred, although many important issues have been raised. I have an open mind on the point that my hon. Friend the Member for Birmingham, Hall Green has raised, and I share the general direction of travel in which the hon. Member for South Cambridgeshire wants us to proceed. The question is what vehicle, what procedure and what legal platform we choose. It does not make sense at the present time to go down the road that the hon. Gentleman is inviting the Committee to take.

Andrew Lansley: I am surprised that the Minister says that an hour's debate on this subject is excessive. It has been an important debate and we have given it the minimum time to do it justice. The Minister's response raised further issues that we might have gone on to discuss further, but we have not. First, I am pleased that the Minister took the amendments in the order that he did, and he was probably right to do so. I am grateful to him for his willingness to consider carefully amendments Nos. 201 and 202 on whether trusts can successfully combine, which is a practical issue. We do not want to get bogged down in the question of whether we press an amendment to a Division.
 I am not persuaded, by virtue of my thinking about the circumstances of Cambridgeshire, that the idea that there should be a service reconfiguration in advance, which then leads to a foundation trust application, is the right way of proceeding. One might well presume that the Addenbrooke's trust would therefore hold back on a first wave application to be able to think about service configuration. In fact, it works the other way round. As a foundation trust, it needs to think about the way in which it can apply itself to creating additional capacity. It does not follow that that will be on the Addenbrooke's site or that it will be offered by the Addenbrooke's trust; it might better be offered by other acute trusts, such as Hinchingbrooke or West Suffolk. 
 The alliance of their freedom to borrow and their ability to create additional capacity with the ability to offer those services in smaller acute trusts, more local community hospitals and acute trusts is the complete opposite of the point that the Minister was making. It is not about centralisation in super-trusts; it is about the additional capacity not necessarily being provided by the super-trust, but by more local and accessible acute trusts working in combination. 
 The question is whether the creation of one foundation trust on the part of the dominant provider makes more difficult the subsequent process of configuration of services when we are working through two different systems. We must work that out. I asked about the mechanism by which other trusts could combine together subsequently in a pre-existing NHS foundation trust. The Minister may like to consider that as a means of dealing with that issue. I 
 will not pursue that matter now, but I hope that we will return to it later. It is an important, practical way of assisting the first wave trusts that are thinking creatively and innovatively about the way in which they reconfigure their services. 
 Commissioning by primary care trusts will not be subject to the processes of local accountability that the Government are setting up for NHS providers in the short, or even medium term. I think that is illogical, and that the matter is being approached in the wrong way. That argument has been established. It is curious, however, that, at the same time, the Minister argues under clause 14 that the fact that the primary purpose of a trust must be to provide goods and services for the NHS precludes primary care trusts. 
 The point of a primary care trust is to provide goods and services. In some respects, it does that directly; in others, it does so through the process of commissioning. I cannot find a definition of ''provision'' that precludes commissioning services from being part of a provider process in the Bill, or in other legislation.

Evan Harris: I have worked out what the Minister meant, and I accept his point. I take a risk by saying that, as I am sure he would have put it better.
 Clause 14 implies that only an NHS trust could authorise the provision of services. If a PCT was a foundation trust, it could not be authorised under the legislation to commission services. Where would the commissioning go? As there is no legislative provision for the PCTs to drop their commissioning function, there is no way for them to be foundation trusts under clause 14. That is how I understand the matter, and that is what the Minister may have said quickly.

Andrew Lansley: We will come back to that matter, not least because Government amendment No. 148 is designed to make clearer a matter that the Minister has already told us is clear under clause 14. We will come back to that later.
 The Minister is arguing that we should not allow primary care trusts to become foundation trusts because the Bill precludes it. That seems to be an argument for coming back to the matter at a later stage with the series of consequential amendments that will allow that to happen. The right hon. Gentleman's statement that new primary legislation would be required in order for primary care trusts to become NHS foundation trusts in their commissioning role makes it all the more necessary that we return to that matter with the intention of creating the legislative vehicle that will allow that to happen, even if there are some transitions and delays before that occurs. 
 I am surprised that the Minister has not referred to the recommendation from the Select Committee that consideration be given to establishing an additional pilot scheme that would allow all the trusts in a particular area to become foundation trusts. As I mentioned in my opening remarks, representatives of the King's Fund have discussed that matter, and the Select Committee has endorsed it. I interpret that to be a whole health economy approach, with the PCTs and providers working together. If the Select Committee endorsed that, I am surprised that the Minister has 
 precluded it already, rather than noting that by amending the legislation we could create the mechanism that would allow such a pilot to take place. 
 If all trusts are to become foundation trusts in the long run, it might be sensible to have a pilot that looks at the consequences of how that happens in a given area at an early stage. That could be in a place like Cambridgeshire, where all the trusts in question, the PCTs, the tertiary hospital and the secondary hospital—a teaching hospital—have high levels of clinical governance. They have the capacity to work together, but the question is how should they do that? Let us work out those problems in practice. The Minister is not giving himself the opportunity to do that. 
 Amendment No. 103 would give primary care trusts the explicit opportunity to become NHS foundation trusts. I gather from my hon. Friends on the Opposition Front Bench and my right hon. Friend the Member for North-West Hampshire that there is support for that argument. I think that we might attract moral support from elsewhere, not least because of the way in which many hon. Members expressed themselves on Second Reading and before. Regardless of whether we have anything more than moral support, I shall certainly press the amendment to a Division. 
 Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 13.

Question accordingly negatived.

Chris Grayling: I beg to move amendment No. 75, in
clause 4, page 2, line 9, leave out from 'trust' to end of line 10.

Peter Atkinson: With this it will be convenient to discuss the following amendments: No. 135, in
clause 5, page 2, line 32, leave out from 'trust' to end of line 33.
 No. 105, in 
clause 6, page 3, line 23, at end insert— 
 '(aa) the application is not objected to by the Secretary of State,'.
 No. 246, in 
clause 6, page 3, line 29, after 'provide', insert— 
 '(dd) the application is endorsed by the relevant local authorities, primary care trusts, patients' forums and representatives from local staff side organisations;'.

Chris Grayling: I shall endeavour to be brief, because I know that we need to move things along. Amendment No. 75 and the consequential amendment No. 135 refer to a matter on which there is a
 fundamental difference of principle between the Opposition and the Government. The amendments would delete the words
''if the application is supported by the Secretary of State''
 in clauses 4 and 5. 
 The issue that we are addressing is simple; the inclusion of those two proposals in the Bill provides clear evidence of the Government's intention to maintain some hold on the reins of decision-making in the NHS. We believe that that is wrong. The powers are wholly unnecessary, and we would like them to be removed. 
 We must ask the Minister a basic question about the freedom to apply. Why should not the regulator simply decide whether an NHS trust's application to become an NHS foundation trust is appropriate? Why is it necessary to duplicate the application process, and why must the trust first make a case to the Secretary of State and win his approval? Only then can it formally put forward the application to the regulator. Why can we not simply make it the decision of the regulator, possibly to agreed criteria—that is, if the regulator is genuinely independent of Government and can take a rational independent view of the rights and wrongs, uninfluenced by the Department of Health? 
 How will an application secure the support of the Secretary of State? Will a full application go to the Secretary of State? I cannot believe that the chief executive of a local NHS trust will simply pick up the phone to the Secretary of State and say, ''Hey, we're going to apply,'' and the Secretary of State will say, ''That's fine.'' Clearly, the trust will have put forward a detailed case to the Department. How will that happen? What deadline will the Secretary of State set for it to take place? Will a trust have to go through a timetable process to secure consent? What conditions will the Department set to permit an application to go forward to the Secretary of State? What criteria will the Secretary of State use to judge whether an application can go to the regulator? Will it be simply a matter of star ratings? 
 I hope the Minister will clarify the statement that his Department made 10 days ago to The Times. It acknowledged that the star rating system may not in future be the criteria used for judging whether an application for foundation status is appropriate because that system allows three-star hospitals to be only a proportion of NHS trusts. It is therefore impossible to extend the number of foundation trusts beyond a certain proportion of NHS trusts without diluting that criterion and accepting that one or two-star trusts should be also be allowed to apply. 
 On the speed of decision making, how quickly will decisions be turned round? Will the Department's consideration of the exercise prolong an application for a significant time? What assessment process will the Department use to decide whether an application is suitable to go forward to the regulator? Does the Secretary of State envisage the regulator routinely having the power to overrule him if he suggests that an application is suitable? Will the regulator really say no it is not? 
 What will be the consequences to a trust of rejection by the politicians, for example if an application from a hospital is turned down by the Department? What consideration have Ministers given to the impact on local management and staff of a veto, not by the regulator, who is the decision maker, but by the politicians? 
 There is a similar effect in the second condition of application permissible in the measure. Clause 5(1) must rank as one of the most intriguing in the Bill: it allows organisations that are not NHS trusts to come forward and establish themselves as NHS foundation trusts. What does the Government envisage will happen as a result of the measure? Are they looking to the private sector to establish organisations that would become freestanding foundation trusts? Would BUPA, for example, float off part of its business and turn it into an NHS foundation trust? Might there be the equivalent of management buy-outs in the national health service, with groups of doctors and staff coming together to establish their own NHS foundation trusts, perhaps securing assets from existing hospitals? 
 These matters will be factors in the Secretary of State's consideration of an application under clause 5(1), but why cannot that decision be assigned to the regulator? Why is a political process necessary? Why is it necessary to expose people who will be setting up foundation trusts under the measure to a politically based, rather than a merit-based, decision-making process through the regulator system? Is clause 5(1) intended as a screening-out mechanism for applicants that politicians deem to be unsuitable for foundation trust status? 
 There is no reason for politicians to remain as part of a process when there is an independent regulator who is supposed to be the arbiter of the foundation hospital sector. We fundamentally disagree with the Government's inclusion of the two proposals and we will vote against them.

Evan Harris: I rise to support amendment No. 75 for the reasons given by the hon. Member for Epsom and Ewell (Chris Grayling). I subscribe to almost all of what he said about this flawed provision and agree that there should not be a political process. I add only that it is nonsense that the Secretary of State would use the star rating system, as it is not clinically based. When providers do well against the star rating system the Government have not adduced a shred of evidence to show that patient care is better or that patient outcomes have improved in clinical terms.

Simon Burns: In the context of the two amendments tabled by my hon. Friends, there would be implications for Oxford's Nuffield hospital. Does the hon. Gentleman support the hospital's application for foundation status?

Peter Atkinson: Order. That is not relevant to the amendment.

Evan Harris: I fear that I am in error for not having provided the hon. Gentleman with the document that I promised him. It awaits him, and he will find out exactly what our view is. I have been reading the
 Conservative document, entitled ''Setting the NHS Free'', which is somewhat thinner. As the Minister said, it does not really address any of the policy issues.
 To return to my point, part of the problem is that politicians base decisions about the NHS on political criteria. The use of such criteria does not have a good record in terms of the patient's interest. 
 My other point, which the hon. Member for Epsom and Ewell touched on in introducing the amendments, is that the Government claim that the creation of foundation trusts is a decentralising measure. However, many people have questioned that. The Government have also claimed that their proposals are all about independence, but trusts must go through a centralising process to achieve foundation status. The achievement of so-called independent status is part of a dependent process, because trusts will even need to ask the Secretary of State for permission to apply. That reveals the Government's motives. They pretend to be decentralising and to be giving independence, but they are centralising even the decision to introduce what they describe as decentralisation, and making dependent what they describe as the creation of independence. I hope that those who put their names to the amendment will press it to a vote, because it deals with a key flaw in the Government's proposals for foundation hospitals. 
 There are two other amendments in the group. I shall leave the hon. Member for South Cambridgeshire to introduce amendment No. 105, which is in his name. Amendment No. 246, which is in my name and those of my hon. Friends the Members for Cheadle and for Sutton and Cheam, is important. It relates to clause 6, subsection (1) of which states: 
''The regulator may give an authorisation under this section . . . if he is satisfied as to the following matters'',
 Subsection (2) lists those matters, and the amendment would add the extra criterion that 
''the application is endorsed by the relevant local authorities, primary care trusts, patients' forums and representatives from local staff side organisations''.
 I am prepared to negotiate about the list—[Hon. Members: ''Oh!''] I think that that is extremely generous. 
Chris Grayling rose—

Evan Harris: If the hon. Gentleman is rising to applaud my generosity, I shall certainly give way.

Chris Grayling: It may seem churlish to draw attention to this, but the hon. Gentleman is endorsing giving politicians both less and more of a role in the decision-making process. That might appear slightly contradictory, given that he is referring to the same set of amendments.

Evan Harris: I think that the hon. Gentleman knows the answer, although I may have been imprecise and not said that my remarks were about centralising politicians who are not accountable to local people. If politicians acting locally were not accountable for their decisions, we would be wrong to include overview and scrutiny committees. However, the Government have introduced the committees, presumably with a view to them overseeing and scrutinising changes in the health
 service. It is astonishing that the Government seem to think that applications can be made regardless of those committees' views or of the fact that they opt for outright rejection. The Government say that the applicant is required, if regulations require it, to consult prescribed persons. I have faith that Ministers will produce regulations that require consultation. Clause 6, subsection (4) states:
''If regulations require the applicant to consult prescribed persons about the application, the regulator may not give an authorisation unless he is satisfied that the applicant has complied with the regulations.''
 Those consulted do not have to agree with the proposal; it is simply the case that the applicant must comply with the regulations. Those of us who know about changes in provision—and the way in which community health councils have been treated—often find that consultation ends with strong opposition over a matter, but the proposal of the local managers is to go ahead regardless. The matter ends up—regrettably, as far as the Government is concerned—on the desk of the Secretary of State, who must attempt to resolve the problem. However, the clause does not provide for even that fall-back measure, unsatisfactory though it is, being a centralised decision. There is no process for patient forums, particularly primary care trust patient forums, to be consulted and to give approval. It is for that reason that amendment No. 246—[Interruption.] 
 I hear chattering from the hon. Member for Ealing, North (Mr. Pound). I am sure that his community health council—while it survives—would expect him to support an amendment such as this, although he is more than capable of speaking for himself. Perhaps he will be dragooned into voting against the amendment. 
 I ask the Government what provision will be made for meaningful local consultation with overview and scrutiny committees, and with primary care trust patient forums. What provision is there for support for foundation status and mutualisation from representatives of the staff? It is quite possible under the arrangements for there to be objections to the proposal from the overwhelming majority of staff employed in a trust, only for them to be dragooned—[Interruption.] Dragooning is what the Government do. The hon. Members for Ealing, North and for Poplar and Canning Town (Jim Fitzpatrick) know a thing or two about dragooning. 
 I regret that we do not have an opportunity to vote on amendment No. 246 at present. We will have to wait for that opportunity. I hope that Ministers will set out in clear terms what provision there is for meaningful local consultation. There should be a local democratic veto over a centralising proposal on change of status.

Andrew Lansley: Amendment No. 105 is in the group for debate. If amendment No. 75 were to be agreed, there would be a curious situation in which the only person who would not have any influence over whether an application went forward would be the Secretary of State. Amendment No. 105 would ensure that, at a later point, the Secretary of State could object if he wished.
 Sitting suspended for a Division in the House. 
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